Coke Cancels FCB Award After PepsiCo Legal Action

12 November 2001

Less than a month after unveiling a sweeping agency realignment [WAMN: 15-Oct-01], Coca-Cola has cancelled the shift of two brands to Foote Cone & Belding in Chicago following legal action by soft drinks rival PepsiCo.

The two accounts, for Dasani bottled water ($20 million) and Powerade sports drink ($60m), will for now stay at their current agencies – New York’s Berlin Cameron & Partners and Wieden + Kennedy in Portland, Oregon, respectively.

FCB lost some $350m of PepsiCo duties in September [WAMN: 24-Sep-01], including Aquafina, rival to Dasani, and Gatorade, the sports drink market leader. However, when Coke said it would shift its brands to the shop as compensation, Pepsi complained that its trade secrets were in jeopardy.

Last week, a Cook County Circuit Court judge in Chicago agreed, imposing a restraining order preventing four FCB staffers connected with the Aquafina account from working on Dasani [WAMN: 05-Nov-01]. Late on Friday, Coke announced the brands would not be moving after all: “We will continue the relationships with our existing agencies until further notice and reassess those relationships when the legal issues are resolved.”

W+K had intended to lay off around 30 staffers in connection with the Coke loss, though it received some consolation in the KMX energy drink. Berlin Cameron continues to handle Coke’s Mello Yello, Minute Maid soda and Mr Pibb accounts.

News sources: Wall Street Journal; New York Times